Recent important income tax caselaws / judgements

SECTION 14A

EXPENDITURE INCURRED IN RELATION TO INCOME NOT INCLUDIBLE IN TOTAL INCOME

Dividend : Provisions of section 14A would apply to a case even where tax free dividend income is earned on shares held as stock-in-trade - Deputy Commissioner of Income-tax, Circle -3(1) v. Damani Estates & Finance (P.) Ltd. (2014) 41 taxmann.com 462 (Mumbai - Trib.)     SECTION 28(i) BUSINESS LOSS/DEDUCTION - ALLOWABLE AS Bad debts : Deposits/advances given in connection with business could not be allowed as bad debt but had to be considered as business loss - Smita Conductors Ltd. v. Deputy Commissioner of Income-tax, Range -3(3), Mumbai (2014) 41 taxmann.com 514 (Mumbai - Trib.)       SECTION 68 CASH CREDIT Creditworthiness and genuineness of transaction : Identity, creditworthiness and genuineness of transaction is not established merely by filing bank account details - Gayathri Associates v. Income-tax Officer, Hyderabad (2014) 41 taxmann.com 526 (Andhra Pradesh) Shares : Where Tribunal recorded a finding that Assessing Officer had treated short-term capital gain declared by assessee from sale of shares as unexplained cash credit merely on basis of doubts and suspicion, said finding being a finding of fact, no substantial question of law arose there from - Commissioner of Income-tax v. Jitendra Dalpatbhai Shah (2014) 41 taxmann.com 523 (Gujarat) Gift : Where Assessing Officer allowed assessee's claim of gift without examining creditworthiness of donor and without considering fact that there was no relationship between assessee and donor and, therefore, there did not exist any occasion for giving a gift, impugned order passed by Assessing Officer was erroneous and same was rightly set aside by Commissioner in exercise of his revisional power - Govind Prasad Agarwal v. Commissioner of Income-tax, Aligarh (2014) 41 taxmann.com 521 (Allahabad)       SECTION 254 APPELLATE TRIBUNAL - POWERS OF Power to grant stay : Where high tax demand was raised on assessee but assessee appeared to have a good prima facie case, demand be stayed - Vodafone India Services (P.) Ltd. v. Assistant Commissioner of Income-tax, Circle -3(3) (2014) 41 taxmann.com 554 (Mumbai - Trib.)   Source : Taxmann